You did know you can supply an update to your proposal after submitting it right? Well you can. Actually I'm surprised by how few applications I see on my section are updated, given that you submit the thing some three or four months before the review...The point is usually to update the preliminary data which you've continued to work on (right?).

In that prior post I addressed some of the whys and wherefores of the update:

[the update] serves to bolster the scientific support as well as to demonstrate your full commitment to the project. It should be something real though. A completion of N=2 to N=12 is real. Going from N=6 to N=8 may not be. New experiments, of course. Be a little judicious though and for goodness sakes have the original application open in front of you because you don't want to supply an update that raises more questions about the design. Don't forget your good grantsmanship and be sure to identify why the update is critical, what part of the research plan it supports and which hypotheses are being tested, if any.
Some areas move faster than others so it is possible that you may have presented at a conference or even submitted a paper with relevant data between grant submission and review. I'd think in these cases it is particularly important to do the update of the application. You certainly don't want a single reviewer who happened to attend your presentation or get your paper to review contributing disproportionately (either pro or con) to your review. What if s/he misremembers the data?
You will also provide a publications update seeing as how only accepted articles are supposed to be included in the Biosketch and/or Progress Report (and if you maintain a 3-4 pubs per year rate, odds are that something will have been accepted between submission and review. you do maintain a steady rate of output, don't you? :-P). Accepted manuscripts can be attached to the update as well.
The timing of the update is important and a little tricky. Obviously you want to include as much information as possible so if you are working away feverishly on something you'd be inclined to wait until the last possible second. Not a good idea. In general earlier is better but of course this compromises your timeline to generate new data. Some general observations might help. The review panel goes up on Commons 30 days prior to the review, so this is one thing to wait for. You may want to use your knowledge of who is on the actual panel to slide in a few tailored comments. Citing that critical person's work (that you neglected in the original app) might be a bit obvious but you can perhaps adjust a hypothesis or two in the update. This is also decent timing because the reviewer likely hasn't gotten really serious about their reviewing until about a month to go (sometimes less). On the shorter end of things, most panels require preliminary reviews and scores about a week before the panel meets. At this point you can be assured that your fate is substantially sealed and it is going to have to be one hell of an update to alter the score much. So a week is too late and likely the individual reviewer will be hardening their judgment at least a week prior to this. So I'd say target the update to within the first week or two of the panel roster being posted on Commons.

Let us see if there are any changes to my advice made necessary by the newly formalized policy:

It is recognized that prior to the initial peer review meeting the applicant organization may have a need to submit additional materials such as revised budget pages, biographical sketches, updated or supplemental pages, letters of support or collaboration and publications (accepted but not yet published

During the initial peer review phase, acceptance of additional materials is at the discretion of the NIH Scientific Review Officer (SRO). Applicants are instructed to contact the NIH SRO if they wish to submit additional materials before peer review that are in addition to the original submitted application.

Additional materials should be sent as a PDF attachment to an e-mail. E-mail communication is preferred. If e-mail is not feasible, please send in a hard copy.

This Notice clarifies the existing policy regarding submission of the additional grant application material and offers a set of NIH Best Practice Guidelines (MS Word - 57 KB) for accepting such material as guidance to the research community.

Hmm. A "best practices guideline"? Let's see if there is anything brand new in this new policy....why yes, I do believe there are some new regulations in here that will affect what PIs can and cannot do with respect to the update.

The deadline for receipt of additional materials is one month (30 calendar days) prior to the peer review meeting. Additional material will not be accepted less than thirty calendar days prior to the peer review meeting

Additional materials will be accepted from the PD/PI or Contact PD/PI for multiple PD/PI applications only with the concurrence of the AOR. The best way to accomplish this depends on the PD/PI's situation; one approach could be that the PD/PI sends the electronic materials to the institutional official who can then forward the email to the SRO. Alternatively the PD/PI may transmit and cc the AOR.

If the Research Plan is 12 pages or less, then only one page of supplemental information will be accepted

Of course the document includes the reminder that you are not obliged to supply an update. As I said in my prior post, many (most?) applicants do not feel that they need to supply additional information so you will be in good company if you do not take advantage of this policy. Make it count, say I. Only update if you have something important.
In conclusion the main issues that change current PI behavior seem to be that you have to get the update in 30 days prior to review, that you need to cc your institutional (grant) official on the update and that you have to observe a 2-page limit.

My experience as both an applicant and a study section member is that, in the majority of cases, reviewers don't look at these updates, and frequently aren't even aware that they exist, sometimes because the SRA doesn't bother forwarding them. This is because it is within the explicitly allowable discretion of the SRA to forward these to the reviewers or not, and it is within the allowable discretion of the reviewer to consider the update or ignore it.
In many instances at Study Section I have had one member raise something from an update and had the rest of the panel simultaneously go, Huh? Update? Whah?" And out of probably a dozen carefully crafted updates I have submitted, I have never ever had one referred to in a summary statement.
Based on all this, I have decided that it is a waste of my time to bother with this shit.

..yup, uh-huh, gotcha, yep..
all except for that conclusion there.
True, you can't force the reviewers to read your update and it may never get to them in the first place.
However, the reason to do it is for the anecdote that PP mentioned. When on (presumably advocating) reviewer wants to use the information to buttress his or her argument that your application is meritorious.
My experience in the more general case is that the panel is willing to take one reviewer's informed description as valid. As in
RandomPanelMember: "Hey, did the PI include any evidence that she has that assay working in her own lab?"
Advocate: "Yes, there was a figure provided in the [Prelim Data / last publication / update] which shows she has it working"
RPM: "Cool"
So all you are trying to do is give a little more ammunition to an advocate in the case that s/he wishes to make use of it.
What does it cost to throw the 2-3 figs you've been working on into a two page summary? Couple of hours? half a day?
Seems worth it to me.

there are some lame reasons being given for rejecting an otherwise solid grant proposal. with funding levels virtually grinding to a halt, i think study sections rely on a few tactics. oh, no preliminary data? then this grant loses out on feasibility. even if it's a simple, widely used technique.
same concept applies to fellowship applications, with different excuses. there's, "oh this person hasn't demonstrated they will be learning anything new, since this application uses a technique they have used in previously published papers."
don't hate the player, hate the game. study sections HAVE to draw the line somewhere, so this is what we're left with. people may disagree with me, but this is my sentiment. otherwise, we wouldn't be salivating for a new president who will propose a better budget so that funding paylines can finally be reasonable.

same concept applies to fellowship applications, with different excuses. there's, "oh this person hasn't demonstrated they will be learning anything new, since this application uses a technique they have used in previously published papers."